Dear members and friends of the food co-op,
We've always been pretty optimistic here at the co-op. We believe in our vision and mission, and our cooperative has 950 member-owners affirming the value we see in this project.
But this week we received some disheartening news. Our lead lender has backed out because of three primary concerns: 1) The project's limited collateral 2) No guarantor for the loan 3) our capital campaign coming up $150,000 short of the equity goal.
So what now?
Commercial loan: We are working with another lender that is familiar with food co-op start-up's.Cooperatives are difficult to finance because there is no one person or small group of primary shareholders to guarantee the loan. The commercial loan would be much easier to secure if we had a supportive member willing to guarantee the loan on the Co-op's behalf.
Site: We were granted one final 30-day extension on our site but each extension has cost us money so if we don't reach our goal this month, we will lose our site and our co-op will likely be dissolved.
Why does it cost $2.5 million to start a Food Co-op?
Our vision is to have a full line grocery cooperative and we are committed to that vision. We're talking a full-scale deli, salad bar, meat dept., produce, dairy, bulk items, health and beauty, and so much more. Three reasons food co-op's fail: too small space, wrong management, under-capitalized. Our project has enough retail space for a full line grocery store and our $2.5 million start up budget ensures that store is properly capitalized.
Setbacks are typical and we are not the first food co-op to face challenges with financing. Having said that, if this Food Co-op is going to happen, we need to make one more equity push over the next 30 days.
This is it, Bismarck-Mandan. If we want a world class food cooperative in our community we have 30 days to make it happen. Anyone on the fence about becoming a member or investing, waiting to see if this is a "Go" or "No Go" -NOW IS THE TIME TO GET OFF THE FENCE AND INVEST. We know those people are out there and we cannot stress the importance of you stepping forward to make an investment in good food and community. Thank you to those who have already invested.
All member-owners will be receiving a letter in the mail about 2 upcoming events in September and a call to action. The first event is to make a final push to raise the remaining funds, the final event will be a member celebration when reach our goal! We have worked so hard over the past 3 1/2 years. Please help spread the word.
Questions? Contact Heidi at (701) 203-3167
Your GM and Board of Directors